A guide to retail banking
These services include cheque and savings accounts, credit cards, mortgages and various types of other loans and investment services relating to retirement and educational planning.
Savings accounts are one option when it comes to retail banking, and they are one of the best places to start when it comes to storing your money. Savings accounts [insert Justmoney link to savings accounts here] are generally good for saving for short-term financial goals like purchasing a vehicle, going on holiday or buying expensive appliances.
There are different types of savings accounts on the market. There are general savings accounts, normally with a lower interest rate, money market accounts where your money is invested in certain different products, long- and short-term accounts where you can only access your money after a set amount of time.
Each account has a different fee structure, term, and interest rate. Make sure you know how much money you want to save, and what you want to do with that money, before you open an account.
This year will see the introduction of Tax Free Savings Accounts (TFSAs), which will be provided by the major banks and various other financial institutions. For more about TFSAs, click here.
A cheque account, or transactional account, is a bank account that doesn't normally earn any interest.
This will be your 'everyday' account, especially if your savings account is a fixed term, or invest account which doesn't come with a bank card.
You will pay a monthly administration fee on this account, as well as certain other fees for withdrawing money, swiping, using interest banking, and transferring money to other accounts.
Credit cards are convenient for purchasing goods online, or for large items in the store, where you might not have all the money at that time.
Credit cards can be very useful, but as with all other debts it's important to keep in mind that they are still a form of short-term debt and you will need to repay every cent you borrow.
You will have to pay a certain amount of interest on the money you borrow with you credit card.
This varies from bank to bank and also how many days you have interest free changes.
There are also administrative fees, swipe fees, and transfer fees that you have to pay on your credit card account. Make sure you know what all the fees are, and what credit card you qualify for (as there are different requirements for different credit cards) before you go to open and account.
Loans are another product you can apply for at retail banks. You can also apply for a home loan, student loan, business loan or a personal loan.
Each loan has a different repayment term, interest rate, and requirements to qualify for the loan.
For more information on all the loans available, click here.
Most banks also offer an online trading platform as part of their retail products. Here, whether a beginner, intermediate, or experienced trader, you can link it to your cheque account, and trade on the stock market.
For more information on online trading, click here.
The banks all have a number of different retail products to offer you. It all depends on what your bank needs are, and how much you are willing to pay. Before opening an account, or buying another banking product, make sure that you shop around for the best deal.
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Do you want to settle your debt?
You may be considering settling your credit account, whether it’s a credit card or various store accounts, now may be as good a time as any. This especially if you have saved, or you received a tax return or salary bonus.
Can you afford a personal loan?
Taking out new debt is not always a choice. However, if you’re not pressed by a medical emergency or an unforeseen disaster, it’s worthwhile considering whether you can actually afford it. But what does it mean to “be able to afford a personal loan”? What percentage of your income should you not exceed dedicating to it?
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